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The Every Day Fabric sells fabrics to a wide range of industrial and consumer users. One of the products it carries is denim cloth, used in the manufacture of jeans and carrying bags. The supplier for the denim cloth pays all incoming freight. No incoming inspection of the denim is necessary because the supplier has a track record of delivering high-quality merchandise. The purchasing officer of the Every Day Fabric has collected the following information: E (Click the icon to view the information.) Read the requirements. Requirement 1. Calculate the EOQ for denim cloth. Begin by selecting the formula used to calculate EOQ. (D= Demand in units for one year, P= Ordering cost per purchase order, C= Carrying cost of one unit in stock, Q= Any order quantity.) (Round the denominator to the nearest cent.) Data Table The EOQ for denim cloth is yards. Requirement 2. Calculate the number of orders that will be placed each year. Annual demand for denim cloth 20,000 yards Determine the formula used to calculate the number of orders that will be placed each year, then calculate the orders per year. Ordering cost per purchase order $160 Carrying cost per year 20% of purchase costs Number of orders Safety-stock requirements None orders per year Cost of denim cloth $8 per yard Requirement 3. Calculate the reorder point for denim cloth. The purchasing lead time is 2 weeks. The Every Day Fabric is open 250 days a year (50 weeks for 5 days a week). Determine the formula used to calculate the reorder point for denim cloth, then calculate the reorder point. Reorder point yards Print Done

The Every Day Fabric sells fabrics to a wide range of industrial and consumer users. One of the products it carries is denim cloth, used in the manufacture of jeans and carrying bags. The supplier for the denim cloth pays all incoming freight. No incoming inspection of the denim is necessary because the supplier has a track record of delivering high-quality merchandise. The purchasing officer of the Every Day Fabric has collected the following information: E (Click the icon to view the information.) Read the requirements. Requirement 1. Calculate the EOQ for denim cloth. Begin by selecting the formula used to calculate EOQ. (D= Demand in units for one year, P= Ordering cost per purchase order, C= Carrying cost of one unit in stock, Q= Any order quantity.) (Round the denominator to the nearest cent.) Data Table The EOQ for denim cloth is yards. Requirement 2. Calculate the number of orders that will be placed each year. Annual demand for denim cloth 20,000 yards Determine the formula used to calculate the number of orders that will be placed each year, then calculate the orders per year. Ordering cost per purchase order $160 Carrying cost per year 20% of purchase costs Number of orders Safety-stock requirements None orders per year Cost of denim cloth $8 per yard Requirement 3. Calculate the reorder point for denim cloth. The purchasing lead time is 2 weeks. The Every Day Fabric is open 250 days a year (50 weeks for 5 days a week). Determine the formula used to calculate the reorder point for denim cloth, then calculate the reorder point. Reorder point yards Print Done

Accounting Information Systems
Accounting Information Systems
10th Edition
ISBN:9781337619202
Author:Hall, James A.
Publisher:Hall, James A.
Chapter10: The Rea Approach To Database Modeling
Section: Chapter Questions
Problem 9P
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The Every Day Fabric sells fabrics to a wide range of industrial and consumer users. One of the products it carries is denim cloth, used in the manufacture of jeans and carrying bags. The supplier for the denim cloth pays all incoming freight. No incoming inspection of the denim is necessary because the supplier has a track record of delivering high-quality merchandise. The purchasing officer of the Every Day Fabric has collected the following information: (Click the icon to view the information.) Read the requirements. Requirement 1. Calculate the EOQ for denim cloth. Begin by selecting the formula used to calculate EOQ. (D = Demand in units for one year, P = Ordering cost per purchase order, C = Carrying cost of one unit in stock, Q = Any order quantity.) %3D %3D %3D (Round the denominator to the nearest cent.) Data Table The EOQ for denim cloth is | yards. Requirement 2. Calculate the number of orders that will be placed each year. Annual demand for denim cloth 20,000 yards Determine the formula used to calculate the number of orders that will be placed each year, then calculate the orders per year. Ordering cost per purchase order $160 Carrying cost per year 20% of purchase costs Number of orders Safety-stock requirements None orders per year Cost of denim cloth $8 per yard Requirement 3. Calculate the reorder point for denim cloth. The purchasing lead time is 2 weeks. The Every Day Fabric is open 250 days a year (50 weeks for 5 days a week). Determine the formula used to calculate the reorder point for denim cloth, then calculate the reorder point. Reorder point %3D Print Done | yards
Transcribed Image Text:The Every Day Fabric sells fabrics to a wide range of industrial and consumer users. One of the products it carries is denim cloth, used in the manufacture of jeans and carrying bags. The supplier for the denim cloth pays all incoming freight. No incoming inspection of the denim is necessary because the supplier has a track record of delivering high-quality merchandise. The purchasing officer of the Every Day Fabric has collected the following information: (Click the icon to view the information.) Read the requirements. Requirement 1. Calculate the EOQ for denim cloth. Begin by selecting the formula used to calculate EOQ. (D = Demand in units for one year, P = Ordering cost per purchase order, C = Carrying cost of one unit in stock, Q = Any order quantity.) %3D %3D %3D (Round the denominator to the nearest cent.) Data Table The EOQ for denim cloth is | yards. Requirement 2. Calculate the number of orders that will be placed each year. Annual demand for denim cloth 20,000 yards Determine the formula used to calculate the number of orders that will be placed each year, then calculate the orders per year. Ordering cost per purchase order $160 Carrying cost per year 20% of purchase costs Number of orders Safety-stock requirements None orders per year Cost of denim cloth $8 per yard Requirement 3. Calculate the reorder point for denim cloth. The purchasing lead time is 2 weeks. The Every Day Fabric is open 250 days a year (50 weeks for 5 days a week). Determine the formula used to calculate the reorder point for denim cloth, then calculate the reorder point. Reorder point %3D Print Done | yards
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